China: Romney's rich because of us

The official Chinese news agency, in an English-language commentary, attacked the GOP presidential nominee for his proposal to label China a currency manipulator.

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“If these mud-slinging tactics were to become U.S. government policies, a trade war would be very likely to break out between the world’s top two economies, which would be catastrophic enough to both sides and the already groaning global economy,” Xinhua’s Liu Chang writes. “For generations, China-bashing has been a cancer in U.S. electoral politics, seriously plaguing the relations between the two countries.”

The commentary also takes a shot at Romney’s wealth, declaring it “rather ironic that a considerable portion of this China-battering politician’s wealth was actually obtained by doing business with Chinese companies before he entered politics.”

China insists the exchange rate for the yuan is set by market forces, while the Treasury Department has consistently said the yuan is undervalued. A weaker yuan makes Chinese goods cheaper in the United States, contributing to the American trade deficit with China. Labeling China a currency manipulator could potentially lead to trade sanctions against the world’s second-largest economy.

Rather than attacking China, Xinhua suggests “[t]o cure its economic ailments, the United States needs to put its own fiscal house back in order, substantially slash its tremendous military expenditure, and optimize its economic structure.”